Denmark’s liberal approach to life in general is mirrored in its attitude to companies coming in from abroad. The business climate is benign in the best sense, notwithstanding high labour costs. Opening a company in Denmark is straightforward, thanks to a streamlined regulatory regime, and more than 2,500 foreign companies already operate in the capital, Copenhagen.
Denmark also has double-taxation treaties with more than 80 countries.
A summary of Denmark Corporate Taxes is available here.
Frequently Asked Questions about Denmark
What are the most common types of company formation available in Denmark?
There are two main types of company to incorporate in Denmark:
– Public Limited Company – Aktieselskab (A/S)
– Private Limited Company – Anpartsselskab (ApS)
How much share capital is required to establish a Public Limited Company (A/S)?
The minimum share capital for an A/S is €67,000.
What other requirements are there to open a Danish A/S company?
– Three directors who must be citizens in the EU
– At least one manager must be employed, who must also be an EU citizen
– Annually audited accounts
– A local serviced office is advisable
How much share capital is required to establish a Private Limited Company (ApS)?
The minimum share capital for an ApS is €10,000.
What aother requirements are there for a Danish ApS?
– Annual accounts audited by a registered auditor
– Neither directors nor managers need be domiciled in Denmark
– A local serviced office is advisable
What other types of company are available in Denmark?
European Public Limited Company (SE) – the minimum amount of share capital is €120,000 and is subject to national company law, however, it is possible to change the nationality of the company without liquidation and re-formation.
European Economic Interest Grouping (EEIG) – this is a cross-border partnership comprising partners from European countries. There are no capital requirements, no requirements for separate financial accounts, and partners are taxed individually.
Joint Venture – this is often established in the corporate form of an A/S or ApS.
Sole Trader – there are no capital requirements but financial reports must be audited and submitted to the tax authorities.
How easy is it to recruit staff?
The Danish labour force is highly skilled and well educated. Unemployment is currently running at around 6% and although salary levels are high by EU standards, they are in line with those elsewhere in the Nordic region.
Recruitment can be achieved in consultation with the government employment offices or through the services of the various commercial employment agencies that exist.
Please contact us to discuss your recruitment requirements.
What is the regulatory environment like in Denmark?
Denmark has a liberal business climate and this is reflected in the regulatory environment. There are generally no restrictions on investments and capital, and earnings can be freely repatriated. Price and exchange controls concern inter company charges and affairs in the transfer-pricing system.
The rate of Corporate Tax is 28%, which is much lower than personal taxation – although expatriates may qualify for a much-reduced Personal Tax rate of 25%. For more information about effective tax planning in Denmark, please get in touch.
Are there financial incentives available in Denmark?
There are limited financial incentives available for businesses setting up in regions of Denmark that are designated by the EU as special development zones.
However, in certain circumstances, incentives are available to small and medium sized enterprises for research and development, export and skills development, and clean environmental technology.
How easy is it to close a Danish company?
Please contact us in order to discuss closing your company in Denmark.
What about banking facilities in Denmark?
Full banking services are available, offering a complete range of commercial banking facilities, including those related to acquisitions and the raising of capital.
Foreign investors considering company formation in Denmark are treated on an equal footing with domestic investors as far as financing is concerned.
For assistance with opening a bank account in Denmark, please contact us.
